Tag Archives: potash

BHP greenlights Jansen Stage 1 potash project

BHP has approved $5.7 billion in capital expenditure for the Jansen Stage 1 (Jansen S1) potash project in the province of Saskatchewan, Canada.

Jansen S1 is expected to produce approximately 4.35 Mt/y of potash, and has a basin position with the potential for further expansions (subject to studies and approvals), according to BHP. First ore is targeted in 2027, with construction expected to take approximately six years, followed by a ramp-up period of two years.

Jansen S1 includes the design, engineering and construction of an underground potash mine and surface infrastructure including a processing facility, a product storage building and a continuous automated rail loading system. Jansen S1 product will be shipped to export markets through Westshore, in Delta, British Columbia, and the project includes funding for the required port infrastructure. This infrastructure will be constructed by Westshore Terminals Investment Corporation as part of an agreement with BHP.

BHP Chief Executive Officer, Mike Henry, said Jansen is aligned with BHP’s strategy of growing the company’s exposure to future-facing commodities in world-class assets, which are large, low cost and expandable.

“This is an important milestone for BHP and an investment in a new commodity that we believe will create value for shareholders for generations,” Henry said.

“In addition to its merits as a stand-alone project, Jansen also brings with it a series of high returning growth options in an attractive investment jurisdiction. In developing the Jansen project, BHP has had ongoing positive engagement and collaboration with First Nations and local communities, and with the provincial and federal governments. Jansen is designed with a focus on sustainability, including being designed for low greenhouse gas emissions and low water consumption.

“We anticipate that demand growth will progressively absorb the excess capacity currently present in the industry, with opportunity for new supply expected by the late 2020s or early 2030s. That is broadly aligned with the expected timing of first production from Jansen.”

BHP said: “Beyond the 2020s, the industry’s long run trend prices are expected to be determined by Canadian greenfield solution mines. In addition to consuming more energy and water than conventional mines like Jansen, solution mines tend to have higher operating costs and higher sustaining capital requirements.”

At consensus prices, the go-forward investment on Jansen is expected to generate an internal rate of return of 12-14%, an expected payback period of seven years from first production and an underlying EBITDA margin of around 70% given its expected first quartile cost position, according to BHP.

BHP says the $4.5 billion (pre-tax) of capital invested to date has resulted in a significant initial outlay. The investment to date includes construction of the shafts and associated infrastructure ($2.97 billion scope of work), as well as engineering and procurement activities and preparation works related to Jansen S1 underground infrastructure. Approximately $220 million of the $2.97 billion approved for the current scope of work, expected to be completed in 2022, is not yet spent.

The construction of two shafts and associated infrastructure at the site is 93% complete and expected to be completed in 2022, with Cementation Canada set to carry out the post liner excavation, steel and equipping of the shafts.

The sinking of the shafts was carried out by DMC Mining Services using Herrenknecht’s Shaft Boring Roadheader.

To date about 50% of all engineering required for Jansen S1 has been completed, significantly de-risking the project, BHP says.

Nutrien to boost potash output from ‘low-cost’ mine network

Nutrien Ltd has increased its first-half 2021 earnings guidance given the strength in global fertiliser markets and strong operational results.

First-half 2021 adjusted net earnings per share is expected to be C$2.30-2.50 ($1.86-2.02), up significantly from previous guidance of $2.00 to $2.20, it said.

In response to continued tightening in global potash market conditions, Nutrien says it is flexing its “low-cost network” of six mines to draw upon its available capacity in a timely manner, planning to produce a further 0.5 Mt of potash, in addition to the 0.5 Mt increase announced on June 7, 2021.

“As a result, we now expect to produce 1 Mt of incremental potash in 2021 compared to expectations earlier this year,” the company said.

The majority of the increased production is expected to occur in the December quarter, with some of these additional tonnes expected to be sold in early 2022.

The company’s updated guidance for potash sales volumes in 2021 is 13.3-13.8 Mt, which would exceed the company’s previous record high for annual sales volumes of 13 Mt set in 2018.

Mayo Schmidt, Nutrien’s President and CEO, said: “The quality and breadth of our integrated network, combined with unparalleled expertise in potash mining and an exceptional transportation and logistics system, helps ensure our customers have the crop inputs they need to feed a growing world and drives tremendous shareholder value. With continued strength in global agriculture and crop input markets, we are raising guidance and expanding our potash production by a total of 1 Mt to ensure farmer’s get the potash they need.”

BCI Minerals signs up WHBO Infrastructure, Engenium for Mardie work

BCI Minerals Limited has confirmed around A$90 million ($68 million) of contract awards for its Mardie Salt & Potash project, in Western Australia, ahead of a final investment decision (FID).

The initial earthworks contract has been awarded to WBHO Infrastructure, a contractor with a long history of project delivery excellence in large civil construction projects and a strong presence in Western Australia.

The contract includes initial construction of the large-scale trial pond scheduled to commence in April, as well as construction of evaporation ponds 1 and 2, on terms aligned with definitive feasibility study (DFS) budget assumptions once the FID is achieved and required tenure and approvals are in place. The total earthworks volume in this scope is approximately 800,000 cu.m over an area of 24 sq.km.

Engenium, the successful tenderer for the Project Management Contractor role, is a Western Australian company with offices in Perth and Karratha. Engenium, which recently signed a letter of intent that could see it acquired by Stantec, was selected for its local and experienced team, proven track record in project delivery and construction management, excellent health and safety record and pricing within the DFS budget, BCI said.

“The PMC is an important contract in the overall execution of the Mardie project which will see Engenium manage the construction program through the provision of people and systems as an extension of the BCI owners’ team,” it said. “Engagement of Engenium on a staged basis will also support BCI to achieve construction-ready status ahead of main construction commencing in the second half of 2021.”

Various smaller contracts covering accommodation village expansion, minor earthworks, site surveys, communications, water supply, fuel storage and supply as well as the Karratha office fit-out have also been awarded this year. These works are all underway with Pilbara-based contractors expanding Mardie village and fitting-out the Karratha office and local indigenous companies carrying out aboriginal heritage surveys and minor earthworks.

BCI’s Managing Director, Alwyn Vorster, said: “The award of the initial earthworks contract, in particular, represents a key milestone in BCI’s progress toward main construction and demonstrates board confidence in Mardie’s development pathway. These contracts will be initially funded from BCI’s healthy cash balance and strong Iron Valley royalty income.”

The Mardie DFS outcomes indicated that the production of 4.4 Mt/y of high purity salt and 120,000 t/y of premium sulphate of potash (SOP) fertiliser was technically and financially viable. The total capital cost came in at A$779 million and the pre-tax net present value (7% discount) was A$1.197 billion.

A FID by the BCI Board is targeted in the June quarter, which will be followed by completion of the funding task. Construction could commence in mid-2021, which will allow for first salt sales in 2024 and first SOP sales in 2025, the company says.

Kore Potash and China’s SEPCO, ENFI to work on Kola potash optimisation study

Kore Potash and Summit Africa Ltd, on behalf of a consortium of investors and engineering firms, have signed a non-binding memorandum of understanding (MoU) to arrange the total financing required for the construction of the Kola potash project in the Republic of Congo.

The MoU with Summit outlines a roadmap to optimise, fully finance and construct Kola via a mix of debt and royalty financing, it said.

Summit and its technical partners, SEPCO Electric Power Construction Corp and China ENFI Engineering Corp, who has been subcontracted by SEPCO, will work with Kore to undertake an optimisation study to reduce Kola’s capital cost with a target of less than $1.65 billion.

Kore, which owns 97% of Kola, will contribute around $900,000 to the optimisation study costs, with SEPCO covering the remaining 50% of the estimated study costs, it said.

Summit is an Africa-focused strategic advisory, corporate finance and alternative investment group headquartered in Mauritius who, in 2016, led and arranged the $50 million financing of the definitive feasibility study for Kola. As part of that financing, both the Oman Investment Authority (then called the State General Reserve Fund) and Sociedad Quimica y Minera de Chile (SQM) each invested $20 million.

Summit’s role in the MoU is to, again, be the lead arranger and to advise the company concerning the most optimal financing solution that would see the delivery of the Kola project, Kore said.

SEPCO will be the engineering procurement and construction contractor for Kola within the Summit consortium. ENFI’s potash-specific experience includes design and construction of an underground potash mine in Southeast Asia.

Summit, SEPCO and ENFI commenced discussions with the company towards financing the construction of Kola in the second half of 2019.

The MoU provides the Summit consortium with a nine-month period to present a financing proposal to fully finance the construction of Kola via a combination of debt and royalty financing. This means the company would not be required to raise equity to fund the capital cost of construction as the equity portion will be covered by the royalty funding with the company retaining its 90% interest in the project (the Republic of Congo Government receiving the remaining 10%).

The results of the definitive feasibility study for Kola were announced in January 2019. During its review of the DFS, the company and its independent consultants identified several opportunities to achieve a material reduction in the capital cost of Kola, but the realisation of these opportunities requires further capital optimisation studies, it said.

“Having already completed a preliminary review of the DFS and the potential optimisation opportunities identified, the technical partners in the Summit consortium (SEPCO and ENFI) have confirmed a target capital cost for the optimisation study of $1.65 billion,” Kore said. “Reducing the capital cost of Kola will reduce the size of the financing required for construction and improve returns for the company’s shareholders. The Summit consortium has set out in the MoU that achieving the target capital expenditure in the optimisation study is a condition for Kore to receive the financing proposal.”

Kola is a high grade, high quality, shallow sylvinite potash deposit situated on an existing mining licence, approximately 35 km from the coast, and 65 km north of the harbour city of Pointe Noire, Kore says. It comes with a 2.2 Mt/y muriate of potash production profile over a 33-year mine life.

The permitting and agreements required for construction are in place including the environmental permit, trans-shipment permit and the Mining Convention with the government.

Once in production, Kola is anticipated to be one of the lowest cost potash producers globally, ideally located to supply nearby African and South American markets, the company added.

Salt Lake Potash nears SOP production milestone at Lake Way

Salt Lake Potash Limited remains on track for first production and sale of sulphate of potash (SOP) in the June quarter after declaring the commencement of process plant commissioning at its Lake Way project in Western Australia.

In a project update, the company said first time potassium-rich harvest salts, precipitated from lake aquifer brine, have been fed into an SOP plant in Australia.

These harvest sales were successfully fed into the feed hopper, conveyed to the surge bin, run through the lump breaker, and then into the attritioning feed tank at the front end of the process plant. This front-end plant commissioning was powered by 2 MW diesel generators, which will continue to be used to progress the process in the near term.

Over the coming weeks the utilities, conversion circuit, flotation circuits, crystallisers and dryer will all be commissioned ahead of full load commissioning and SOP production in the June quarter, it said.

Consultants from the plant designer, Wood Group, as well as vendors Veolia and Broadbent (among others) will be assisting in the commissioning process.

In the meantime, gas supply lines and the delivery station for the 10 MW power station have been fully commissioned, with “power on” scheduled for late April to support final commissioning activities and production commencement.

Lake Way is a 245,000 t/y SOP development with an expected mine life of over 20 years. Located in the Goldfields region of Western Australia, it is expected to produce a high-quality SOP fertiliser with the help of Veolia Water Technologies’ HPD® crystallisation systems, among other processes.

Uralkali strives for safer, more efficient operations with new technology

One of the leading global producers of potash, Russia-based Uralkali has five mines and seven ore treatment plants in the towns of Berezniki and Solikamsk, in the Perm Region, to its name. As IM discovered from an exchange with Eduard Smirnov, the company’s Technical Director, many of these operations are leveraging new innovations for safety, productivity and efficiency.

IM: In terms of automation, electrification and digitalisation, where is Uralkali making the most notable technological advances?

ES: Uralkali is focused on implementing new technology to make our operations safer and more efficient.

In 2020, we introduced the Geological and Mining Information System (GMIS), which is a single database containing all the necessary information about mine fields and surfaces (spatial data about objects, geological, geophysical and chemical parameters of rocks, data on plant facilities, etc) in order to plan and manage all production processes related to ore mining. The system provides full automation of geological surveying and mining operations, as well as reporting.

Eduard Smirnov, Uralkali Technical Director

We have also introduced an alert system for mine personnel, which can warn miners through the rock mass using low-frequency electromagnetic pulses in case of an accident, as well as a system for positioning personnel and vehicles in mines with information output to the mine dispatcher’s console unit.

This positioning system includes zone readers with antennas, which are located at the entrance to the mine cage and at the exit from the cage at the bottom level, as well as in the mine shops; garage; petroleum, oils and lubricants depot; and explosives depot. These systems are also located along the transport and evacuation routes and monitor every entry to the panel in which mining is underway. The movement of vehicles carrying people is also monitored, including inside each vehicle.

When emergency response is activated, the mine’s central control room sees how many people and vehicles there are in the mine and how they move towards the shaft exit.

Among other systems that have been automated at Uralkali’s facilities are:

  • the control of conveyor lines and hydraulic backfilling of mine voids;
  • skip and cage hoist, batch plants, key ventilation units;
  • gas calorifers (heaters), which are used for heating the air in the mine;
  • re-ventilation systems; and
  • boiler stations and gas turbine units.

Tunnelling machines are equipped with a Combine Condition Monitoring System, which, through wireless sensors of vibration, temperature, oil presence and oil contamination, collects and transmits data on the state of the combine units both to the main computer control panel and to an external information retrieval device (smartphone, flash card). Additionally, the system collects and transmits information about the technical regime of the combine. All collected information is then transferred to a common database to generate statistical and analytical reports.

Self-propelled vehicles and tunnelling machines are electrified and powered by high-voltage cable.

Wireless systems for continuous dynamic control of smoothness of movement of the lift conveyance have been introduced into the skips, which makes it possible to identify defects in the reinforcement on the specific tier of the shaft.

We have also installed a virtual reality simulator for personnel to train electrical shifts at our power substations.

IM: Are you using digital technology for both equipment maintenance and plant process control?

ES: We use wireless transmission of data from observation hydrogeological wells at different sites and level control in the dam of a pond.

We also use video monitoring for our technological processes, such as product loading into cars, wagons, control of dead spots, product distribution between bunkers and at remote sites, as well as for maintenance and construction.

Uralkali is also implementing a module for video analytics of wearing a mask when entering or leaving the cage.

QR codes are used for weighbridges for automatic transmission of data on routes and weight of the loaded product.

We have also introduced automatic data transmission to the Automated Transport Logistics Control System from all rail weighing systems and the generation of documents for shipment via Russian Railways. We also use automatic (sometimes wireless) data transmission from commercial gas metering units and an automated gas balance formation system.

A Mobile Wireless Vibration and Temperature Sensors System is being introduced as another example of digital technology.

We have launched a pilot test of the virtual mathematical moisture analyser for the furnace at one of our facilities to improve the drying process and introduced mathematical control models for steam boilers operating at optimal efficiency.

IM: When it comes to personnel safety, what systems do you have to reduce vehicle-to-person or vehicle-to-vehicle interactions in your mines?

ES: Personnel safety at our operations is our number one priority, and we use a number of systems to continuously increase our safety performance. For example, we use rear-view cameras for all vehicles, produced by Brigade Elektronics, SMD Company LLC and SPbEC-Mining LLC (more than 200 machines are equipped). We are also testing personnel safety systems in tunnelling machine areas, which are based on magneto generators and individual miners’ tags. These include two systems from Davis Derby and Mine Site Technologies (MST).

Matrix to construct first phase of American Pacific Borates’ Fort Cady mine

American Pacific Borates Ltd has appointed Matrix Service Company to complete the construction of Phase 1A of the Fort Cady borate mine, in USA.

Matrix, as the prime contractor, has already begun integration with the company’s Fort Cady borate mine office and engineering consultants to ensure completion of the initial borate operation in the September quarter of 2021.

American Pacific Borates CEO and Managing Director, Mike Schlumpberger, said: “We are delighted with the appointment of Matrix to complete the construction of Phase 1A of our Fort Cady Borate Mine. Matrix is a leading North American industrial engineering and constructor contractor headquartered in Tulsa, Oklahoma.

“Matrix’s core values of safety and community involvement align perfectly with American Pacific’s core values and intention to ensure the mine is delivered safely and with positive community involvement. This is another important step in the fulfilment of our aspiration to become a globally significant producer of borates and specialty fertilisers.”

The company says its current intention is to retain Matrix for the balance of the three production phases of the Fort Cady borate mine.

The enhanced DFS for Fort Cady, released in April 2020, outlined sulphate of potash production (in full production) of 363,000 t/y and boric acid production of 408,000 t/y. Phase One A production is scheduled to be 8,200 t/y of boric acid, alongside 36,287 t/y of sulphate of potash.

Nutrien increases use of Triax’s Proximity Trace tech to curb COVID-19 spread

Nutrien says it is expanded its use of proximity monitoring and contact tracing technology, Proximity Trace™ from Triax Technologies, to its potash mines in Saskatchewan, Canada, as it looks to continue tracking and combatting the spread of COVID-19.

More than 8,000 employees are using the technology to date, with an additional 6,500 expected to be part of the expansion in the coming months, representing 65% of Nutrien’s global employee base.

At the start of the pandemic, Nutrien was deemed an essential service in its core markets for its role in supporting the agriculture industry. To help mitigate the spread of the virus, Nutrien partnered with Triax to help its workers maintain a minimum of 6 ft (close to 2 m) of physical distancing and automatically capture data about their interactions with co-workers, as part of its COVID-19 protocols.

Originally deployed last July at Nutrien’s nitrogen and phosphate sites in the US, Proximity Trace is now being rolled out at Nutrien’s potash mines in Saskatchewan and at corporate offices in Colorado, Illinois, Alberta and Saskatchewan, it said.

Nutrien EVP & Chief Information Officer, Brent Poohkay, said: “In the early days of the pandemic, global health authorities called upon the private sector to step up and do our part to help flatten the curve and slow the spread of COVID-19. Nutrien developed a playbook that articulates a strategy and a plan for handling the virus, and the Triax system has been valuable in keeping our essential workers safe to help ensure a health crisis doesn’t become a food crisis.

“Now we are expanding the playbook as we redefine the future of work with safety and integrity at the forefront.”

Proximity Trace tags are attached to workers’ clothing or hard hats and produce an audio and visual alert to those who come within 6 ft of one another. These wearable sensors also automatically log data for leaders to quickly perform contact tracing if a positive case arises, thereby preventing further spread at the site and reassuring those who are not at risk, Nutrien explains.

“Since it pinpoints the individuals who may have been exposed, the solution also helps Nutrien minimise operational shutdowns and reduces the risk of associated costs and product delivery delays,” it said.

Dr Tarek Sardana, one of the medical experts who’s been advising Nutrien’s executive leadership team regarding COVID-19 responses and protocols, said: “At the workplace, if you maintain proper physical distancing, then your risk of spreading the virus is very low. I encourage people to think of themselves as if they’re living within six-foot bubbles, and if no one penetrates the bubbles, it’s harder for the virus to spread.”

Robert Costantini, CEO of Triax Technologies, said: “We’re honoured that Nutrien has included our Proximity Trace technology as an essential part of its COVID-19 health and safety playbook. Nutrien’s commitment to worker safety through physical distancing and contact tracing was prioritised early on by their management and their focus on this issue has been exemplary. We’re pleased that our wearable sensors can play a critical role in enabling these protocols to create a safer environment.”

Since the implementation of the Triax technology, Nutrien has been able to safely support as many as 1,700 employees and contractors at a time at its nitrogen and phosphate sites. The physical distancing alerts have reduced the number of close contacts, positive cases and quarantines. Additionally, the automated data system has improved the efficiency and accuracy of contact tracing, it said.

“As Nutrien explores how to safely return more employees who have been working remotely to the workplace, the Triax technology will support additional prevention and protection across Nutrien’s North American footprint,” the company concluded.

Leading potash miner takes a liking to RPMGlobal’s UGPS software solution

RPMGlobal says it has concluded the first sale of its latest integrated mine planning and scheduling product developed for the underground potash industry.

The first sale of Underground Potash Solution (UGPS) was concluded following completion of a successful trial program with a leading global potash miner who has purchased UGPS to extract greater value from their Canada operations. The sale follows the original release of UGPS to the market in October 2020.

UGPS was launched upon the completion of a development project that included input from global potash producers. The product uses the latest technologies, such as parametric design and scheduling, combined with several optimisation algorithms to create a unique offering specifically for potash operations, RPMGlobal says.

RPM Chief Executive Officer, Richard Mathews, said: “It has been really fascinating working with some of the leading producers in the industry to build a software planning and scheduling solution which addresses the unique challenges faced by the potash industry.

“At RPM, we continually strive to develop innovative solutions that provide a pivotal step change in the resource industry and we are very pleased that our latest integrated mine design and scheduling solution has been endorsed by a leading potash operator in North America.”

UGPS introduces to the market an enterprise application allowing users to rapidly evaluate different mine design scenarios, the company says.

“Instead of having to manually draw the mine layout in a CAD package, the parametric design techniques of UGPS enable a planner to rapidly generate and analyse multiple scenarios, thereby automating the repetitive and time-consuming tasks that can often take a mine planner weeks to perform,” RPMGlobal says.

The intuitive, process-driven interface makes the product easy to use, and, while most mine planning software is driven by customisable coding scripts, UGPS is very different given it is completely script free, according to the company. This feature becomes very important in terms of training and on-boarding new people, enabling each customer to derive immediate benefits following implementation of the product.

Using UGPS, users can complete detailed modelling of their potash deposit in 3D while also creating a complete mathematical model of the mine. Moreover, users are able to import existing designs, create new designs or use a combination of both.

“UGPS also introduces advanced scheduling methodology to the scheduling process to suit the practical needs of engineers operating in an underground potash environment,” the company says. “It also incorporates all aspects of the scheduling process in one, making it applicable for design, reserving and scheduling across all horizons.”

Mathews concluded: “As a fully integrated mine planning and design tool, UGPS is tailored to the needs of the underground potash industry and we are looking forward to rolling out UGPS to additional potash operations in 2021.”

Alltype Engineering gassed up in Western Australia

WestStar Industrial’s engineering construction contracting business, Alltype Engineering, has been awarded contracts to a total value of circa-A$8 million ($6 million) across multiple clients and projects, including A$5 million of contracts in gas transmission.

APA Group has contracted Alltype to deliver multiple gas offtake and metering facility projects throughout the Midwest region of Western Australia. These turnkey multidiscipline projects involve civil, structural, mechanical, piping, electrical and instrumentation scopes, both workshop and site, with remote area working conditions and logistics and eight off-workshop fabricated gas skids to be completed off site.

Included in the projects are a gas lateral offtake and metering station for the Beyondie sulphate of potash project (pictured), a gas lateral offtake and metering project for the Lakeway SO4 potash project, and gas lateral offtake and metering work for Capricorn Metals’ Karlawinda gold project.

WestStar is also scheduled to build a gas lateral metering station for Primero Group at the Kalium Lakes potash project.

WestStar said: “These newly awarded contracts for Alltype continue to demonstrate its strength and reliability in working successfully with APA and the Australian gas industry, including both upstream and downstream projects.

“Furthermore, having fabricated, assembled and FAT tested over 20 modularised gas skid process packages in the last two years, Alltype continue to leverage off this experience and knowhow to fast track aggressive timeline projects with full supply chain control.”

Alltype has commenced the works for APA Group, which are planned to be completed by the March quarter of 2021.

In addition to this work, Alltype says it was awarded its first contract from Newmont at the Boddington gold mine, also in Western Australia. This contract had an aggressive timeline for completion of urgent fabricated plate and piping componentry for a shutdown, which was achieved. The balance of works is in the process of being completed, it noted.

Still in Western Australia, Alltype says it continues to provide goods and services for the three major iron ore developments in the Pilbara, being BHP South Flank, Rio Tinto Gudai-Darri and FMG’s majority-owned Iron Bridge project.